Ewing's sarcoma is a highly malignant bone-associated cancer of children and young adults that usually expresses the EWS/FLI fusion protein. EWS/FLI is the key oncoprotein in Ewing's sarcoma, and functions as an aberrant transcription factor. We recently demonstrated that EWS/FLI downregulates many more genes than it upregulates, and that a portion of these are directly regulated by EWS/FLI binding. This suggests that the widely-accepted model of EWS/FLI functioning as a transcriptional activator may be incomplete, and that it may act as a transcriptional repressor in some settings. Furthermore, our work identified a number of dysregulated genes that are required for the oncogenic behavior of Ewing's sarcoma cells, but suggested that additional targets remain to be identified. Finally, we made the unexpected discovery that EWS/FLI upregulates some of its targets by binding to GGAA-containing microsatellites. This was surprising because these microsatellites do not conform to known EWS/FLI binding sites, nor have they been previously implicated in cancer development. Based on our preliminary data, we hypothesize that EWS/FLI functions as a transcriptional activator at some loci, and as a repressor at other loci, that both of these functions are required to dysregulate critical target genes to induce oncogenic transformation, and that polymorphisms that effect transcriptional function at these loci modulate Ewing's sarcoma susceptibility or prognosis. Experiments are now proposed to test this hypothesis. The transcriptional repression domain of EWS/FLI will be defined, and its role in both the transcriptional and oncogenic function of EWS/FLI determined. Identification and analysis of genes directly regulated by EWS/FLI using both experimental and computational approaches will allow for the identification of new key targets that are involved in the development of Ewing's sarcoma. Analysis of microsatellites in patients and populations will help to define the role of these elements in disease phenotypes and susceptibility to Ewing's sarcoma. At the completion of these studies, we will have developed a deeper understanding of the mechanistic basis of Ewing's sarcoma and applied it translationally. This may allow for the development of new prognostic or therapeutic approaches to this disease, and may impact on our understanding of other ETS-associated cancers as well.